DIY company Kingfisher is pressing ahead with the closures of B&Q branches across the UK, and announced it will open the opening of 200 additional Screwfix stores. In a clear move towards its hardware subsidiary, the English-French company plans to add a significant amount of branches to the existing UK base of 412 Screwfix stores.
Kingfisher previously revealed plans to launch the Screwfix chain in Germany, a move that signals further expansion into Europe. The company said the trial is well on track.
Veronique Laury, the chief executive of the umbrella company, stated: "I am pleased with the progress made to exit most of the B&Q stores earmarked for closure this year, which will in time strengthen our balance sheet and maintain our financial flexibility."
The store openings were announced in the company's half year result, which showed that profit was still falling, dragged down by a poor B&Q performance. Like-for-like sales were up 2% to £5.38bn (€7.34bn, $8.29).
Laury said: "In the short term, whilst we remain encouraged by the macroeconomic backdrop in the UK, we remain cautious on the outlook for France."
French industrial output recently plunged to its lowest point in November 2014, suffering a 0.8% fall, against a 0.2% growth expected by the market and the economy growth has been disappointing. Profit at Kingfisher's French subsidiaries was down 5.7% on a constant currency basis, while its UK and Ireland division boasted a 16.8% profit rise. The good performance in the UK was fuelled by a 16.5% jump in like-for-like sales in Screwfix stores, which continue to outperform other divisions.
Laury told investors: "Our balance sheet remains strong, enabling us to continue investing for growth and to return so far this year, £160m via share buyback. We are also today announcing growth in the interim dividend, ahead of earnings, reflecting our confidence in our medium term prospects."